11 MAY 2022

Disney+ added 7.9 million subscribers last quarter to hit 137.7 million total

The Walt Disney Company reported earnings for its second fiscal quarter, and it added more subscribers than expected to its family of streaming services.

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The Walt Disney Company reported earnings for its second fiscal quarter, and it added more subscribers than analysts expected to its family of streaming services. Specifically, Disney+ added 7.9 million subscribers last quarter to hit 137.7 million total, Hulu added 300.000 subscribers to reach 45.6 million subscriber, and ESPN+ added 1 million subscribers to reach 22.3 million.

Revenues for the quarter and six months grew 23% and 29%, respectively, despite a $1 billion reduction for the amount due to "a customer to early terminate license agreements for film and television content delivered in previous years in order for the company to use the content primarily on its direct-to-consumer services,”  the company explained.

At the same time, The Walt Disney Company’s media and entertainment distribution division, which includes streaming, had revenues of $13.5 billion in the quarter, up 9% from a year ago. Streaming led the way, with revenues up 23% to $4.9 billion. Meanwhile, linear networks were up 5% to $7.1 billion.

“Our strong results in the second quarter, including fantastic performance at our domestic parks and continued growth of our streaming services —with 7.9 million Disney+ subscribers added in the quarter and total subscriptions across all our DTC offerings exceeding 205 million— once again proved that we are in a league of our own,”  said Bob Chapek, Chief Executive Officer of The Walt Disney Company.

“As we look ahead to Disney’s second century, I am confident we will continue to transform entertainment by combining extraordinary storytelling with innovative technology to create an even larger, more connected, and magical Disney universe for families and fans around the world,”  Chapek added.

●  ARE DISNEY BUNDLES THE KEY TO SUCCESS?

As The Walt Disney Company reported its quarterly earnings, Parrot Analytics has found signs of long-term strength in the company’s streaming and entertainment efforts. According to the researcher, Disney’s path to streaming dominance lies in its Disney+ and Hulu bundle, which already are leaders in streaming original and exclusive licensed content demand, and also on ESPN+, which will become more integral in the near future as current sports broadcasting deals expire and major North American leagues sell more exclusive games to streaming platforms.

When it comes to global and demand for content in the United States, Disney sets the industry pace in several categories: the company remains in first place in US corporate demand share, although its lead over the competition has shrunk significantly due to the Warner Bros. Discovery merger.

Furthermore, Disney+’s global demand share for streaming originals has increased nearly 50% year over year. Since the beginning of 2021, all five Marvel live action originals have hit number one worldwide within two weeks of debuting. Moreover, five of the top 10 streaming original shows with US audiences last week were Disney+ originals - including two Marvel and three Star Wars series.

Meanwhile, Hulu leads the US industry in on-platform demand share, "a good barometer of which SVODs can serve as the default 'streaming home' for tens of millions of consumers," according to Parrot. However, just six months ago, Netflix topped Disney as the world’s most valuable entertainment company. As of May 10, 2022, Disney’s market cap was roughly 2.5x times higher than Netflix’s. This ratio is directly reflected in the difference between their respective corporate demand shares: Disney’s 19.8% share was 2.4x higher than Netflix’s 8.2% share in the latest quarter.

“While the market could drag down Disney’s stock price in the near term, Parrot Analytics views Disney as one of the three media conglomerates - along with Netflix and Warner Bros. Discovery - with the best long-term outlook in capturing and retaining audience attention in the United States and around the world,”  Parrot concluded.